State-owned Life Insurance Corporation (LIC) is set to continue its focus on increasing the share of non-participating (non-par) products in its mix to further grow its margins. This strategic move comes after the insurer reported strong profit growth in the fourth quarter of the financial year 2024-25 (Q4FY25).
LIC’s shares surged over 8% on the BSE following the release of the insurer’s Q4FY25 results, closing 8.21% higher at ₹942.55. Brokerage houses have maintained a bullish stance on the stock, citing LIC’s plans to improve margins through various strategies.
Key Highlights
- LIC’s total number of agents stood at nearly 1.49 million as of FY25.
- The insurer added over 72,000 agents during FY25, boosting its market share to 47.6% based on agent numbers.
- Analysts at Motilal Oswal believe LIC’s focus on wider product offerings, higher ticket sizes, and a shift towards non-par products will drive growth recovery.
- The expansion of the agency channel, along with higher contributions from bancassurance and alternate channels, is expected to aid this recovery.
Financial Performance
- LIC’s net profit rose 38% to ₹19,013 crore in Q4FY25.
- The Value of New Business (VNB) margin improved to 18.7% in Q4FY25 from 17.21% in Q4FY24.
- Annualised Premium Equivalent (APE) was down 10.98% year-over-year to ₹18,953 crore, partly due to changes in product regulations introduced on October 1, 2024.
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Analysts at Emkay Global Financial Services noted that LIC’s plans to expand its non-par product share and improve VNB margin could be partially offset by APE growth. The company’s gross non-performing assets (NPAs) improved, dropping 55 basis points to 1.46% during the quarter.
With these developments, LIC is poised to strengthen its position in the insurance sector through strategic product mix adjustments and channel expansion.
